Business 9609 · AS & A Level · Location and scale

Location and scale — practice question

(a)[1]

Using Table 1.1. Calculate the payback period for SCC’s new factory.

(b)[3]

Using Table 1.1. Calculate the accounting rate of return (ARR) for SCC’s new factory.

(c)[12]

Evaluate whether SCC ought to invest in the new factory.

Worked solution & mark scheme

This 16-mark question has a full step-by-step worked solution and mark scheme. One marking point: Payback period calculated correctly (3 years and about 1.2 months / equivalent forms: 3 years 2 months / 3.1 years / 3 years and ~37 days).

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